Buy HAL, Mazagon Dock shares; stay cautious in Cochin Shipyard, suggest Anand Rathi

Indian benchmark indices posted mild gains on Monday, as the fag end selling dragged the markets lower amid the prevailing cautious stance. Global markets are looking towards US Fed's rate cuts. BSE Sensex added only 76.54 points, or 0.09 per cent, to settle at 80,787.30, while NSE's Nifty50 gained 32.15 points, or 0.13 per cent, to close at 24,773.15 for the day.
 

Select buzzing defence stocks including Hindustan Aeronautics (HAL), Mazagon Dock Shipbuilders and Cochin Shipyard are likely to remain under the spotlight of traders for the session today. Here is what Jigar S Patel, Technical Research Analyst at Anand Rathi Shares & Stock Brokers has to say about these stocks ahead of Tuesday's trading session:
 

Mazagon Dock Shipbuilders | Buy | Target Price: Rs 2,900 | Stop Loss: Rs 2,500

A strong base formation is visible in Mazagon Dock at the 200 DEMA, reinforcing the stock’s support zone. Simultaneously, the MACD histogram and signal line are showing bullish divergence, suggesting fading bearish momentum and a potential reversal. Considering these technical factors, we recommend initiating long positions in the Rs 2,700–2,650 zone. A protective stop-loss at Rs 2,500 on daily close basis is advised to manage downside risk. On the upside, the stock has the potential to move towards the Rs 2,900 target. The overall setup indicates a favorable risk-reward scenario with strong technical backing for a bullish outlook.
 

Cochin Shipyard | wait & watch

Cochin Shipyard is currently trading around the 61.8 per cent Fibonacci retracement level of its recent upmove, a crucial zone that often acts as a key support or resistance. However, there are no clear signs of reversal yet, keeping the near-term trend uncertain. The MACD indicator suggests consolidation within the Rs 1,600–1,700 range, indicating a lack of strong directional bias for now. Hence, we recommend adopting a wait-and-watch approach until further confirmation emerges. A decisive close above Rs 1,700 will be critical to signal strength and the possibility of resuming upward momentum, while sustained weakness below may extend consolidation.
 

Hindustan Aeronautics | Buy | Target Price: Rs 4,800 | Stop Loss: Rs 4,300

HAL is exhibiting a strong base formation at the 200 DEMA, which is reinforcing its support structure and providing stability at lower levels. At the same time, the MACD histogram and signal line are showing bullish divergence, indicating waning bearish momentum and the likelihood of a reversal. In light of these technical signals, we recommend building long positions in the Rs 4,500–4,400 range, with a protective stop-loss at Rs 4,300 on a daily close basis. On the upside, the stock holds potential to rally towards Rs 4,800. The setup reflects a favorable risk-reward profile with bullish technical confirmation.